A Review of the Nigerian Energy Industry

Financial market products & services update

Financial markets.
Financial markets.

27 July 2015, Sweetcrude, Lagos – Local and international financial market products & services update.
NIGERIA: Nigeria’s total debt stock now stands at N12.12tn ($63.81bn), the Debt Management Office has said. Statistics obtained from the organisation on Sunday showed that the domestic debt stock of the Federal Government as of June 30 stood at N8.39tn or $42.63bn. The domestic debts of the 36 states of the federation and the Federal Capital Territory Administration, on the other hand, stood at N1.69tn ($10.86bn) at the end of June. On the external sector, the country’s debt stock was put at $10.32bn (N2.03tn) at the end of June. The DMO gave a hint that the actual domestic debt of the states could be higher because the figure only reflected the position of the indebtedness of the states as of December 31, 2013. It added that the compilation of the 2014 debt stock for the states and the FCT was in progress.
FX: No significant change in the market as the two way quote FX market remains shut. Special auction funds still maintained at 196.00/197.00.

FIXED INCOME: At Friday’s MPC, all rates were kept unchanged as expected – MPR at 13%, CRR at 31%. Lighter volume in bonds compared to the rest of the week. A bit of a mixed bag though and bonds closed marginally weaker as street waited for MPC outcome. In bills, short dated paper (60days and below) reversed Thursday’s losses, long dates were unchanged. O/N rates closed lower at 20% even though money market liquidity has not improved (sub N100bn). Average yield on bills now 14.04% and bonds 14.74%.

CHINA: China’s overnight money-market rate climbed to the highest level since early May amid rising demand for funds as the end of the month approaches. Commercial lenders need to park companies’ tax funds at the People’s Bank of China in the month after the quarter-end and this often drives short-term rates higher. Finance Ministry deposits due last week drained 50 billion Yuan ($8.1 billion) from the banking system. The PBOC added a net 30 billion Yuan via open-market operations in the period, reports showed. The overnight repurchase rate rose four basis points to 1.37 percent, the highest level since May 8, a weighted average from the National Interbank Funding Center showed. The benchmark seven-day repo rate, another gauge of interbank funding availability, was little changed at 2.51 percent after climbing last week to its highest level since July 6.

EUROPE: Talks between Greece and its European creditors on a third €86bn (£60bn; $94bn) bailout have been delayed due to logistical problems, officials say. Greek officials had been expected to meet representatives of EU creditors in the Greek capital Athens on Friday. But a European Commission spokeswoman later said those representatives would arrive “in the coming days”. Separately, Greece formally submitted a request for a new loan from the International Monetary Fund (IMF).

COMMODITIES: Oil prices fell after closing the previous session at their lowest levels since March on renewed oversupply concerns from the United States and Iraq, although a weaker dollar helped to limit deeper losses. Investors are looking to the U.S. Federal Reserve for direction this week. The central bank starts a two-day policy meeting on Tuesday that could result in a September interest rate hike that would strengthen the greenback.

Macro Economic Indicators
Inflation rate (YoY) for Nov., 2014                   9.20%
Monetary Policy Rate current                          13.00%
FX Reserve (Bn $) as at January 09 2015     30.773

Money Market Highlights
O/N                                  19.2083
30 Days                           15.4321
90 Days                           16.6393
180 Days                         17.5294

USD 1 Month                 0.1890
USD 2 Months               0.2430
USD 3 Months               0.2936
USD 6 Months               0.4697
USD 12 Months             0.8071

Benchmark Yields
Tenor     Maturity     Yield (%)
91d           29-Oct-15          14.27
182d         21-Jan-16         13.64
364d        02-Jun-16         14.39
2yr            27-Apr-17         14.62
3yr            29-Jun-19        14.75
5yr            13-Feb-20        14.46

Indicative Currency Exchange Rates
                          Bid        Offer
USDNG         198.05      198.75
EURUSD       1.0993      1.1195
GBPUSD       1.5417      1.5619
USDJPY        123.35      123.38
USDCHF       0.94945   0.9596
GBPEUR       1.3886      1.4090
USDZAR      12.4833     12.6867
JPYNGN      160.2497   160.3503
CHFNGN       207.38      209.07
EURNGN       218.24    219.60
GBPNGN        311.16     312.57
ZARNGN          15.06      16.98

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